Business and finance

Is your credit report important? There are a lot of people who would not consider their credit rating as something too important to them in their life. There are others who, while recognising its importance, would not be overly concerned about the issue or understand the reasons for its importance. Well, to those people, they should at least be aware of some of the uses that are made of credit reports in the world in which we live.

Lenders

While it may seem obvious to state it, credit reports are predominantly concerned with assessing the risk involved in lending money to you. Lenders are obsessed with one thing, getting repaid, and their entire industry revolves around making this occur. Therefore, they have developed the credit score that will assess your likely hood of repaying them and this is then used to either approve or reject your application for credit. While this is the basic purpose, some more sophisticated lenders desire to get in on an ever larger share of the market and in order to lend to higher risk borrowers, they create different categories of loans which people with lower scores can qualify for. These loans will invariably have higher interest rates and other less favourable conditions and this will be the price you pay for having a lower credit rating.

Since loans are used to finance homes, education, cars, and most other large purchases in life, the inability to get access to credit, or only to be able to get it at less attractive terms and rates, is a substantially reason to care about your credit report and try to keep it in as good a condition as possible.

Credit reports are also used when you apply for renting or leasing accommodation. This is usually because the landlord wants to be fairly certain that you’ll be able to pay your rent as it falls due. So keeping your credit score healthy at this stage will pay off if you need to be approved for renting or leasing residential property.

There is also a trend among employer to start using credit ratings when assessing job applicants. The reasons they are making use of credit reports are of course different for every employer but there is a consensus that a healthy credit report and a good past record of meeting financial commitments is a good sign that the job applicant is someone reliable and worth employing. While it does seem slightly perverse that the very people that will need a job the most are precisely the ones that can be denied it but that’s the direction things are moving in.

Insurance companies are doing it - so are mortgage companies and airlines. They are toiling to supply data so that a fast-paced society can access a side-by-side comparison, eliminating the mystery of a good deal.

A few clicks and you can see what the cards offer and what you will need to pay for the service provided. No nagging sales representatives hanging over your shoulder or ruining a perfectly good meal - just an internet ready computer and a little time to look through the issues to find a good match.

Today the same applies to the airline credit card industry. Now you have the opportunity to compare before applying for a card. You can choose which card reflects your credit rating, provides the best rates, perks and special introductory Annual Percentage Rate (APR) offers.

The ‘Welcome Bonus’: What does it mean?

The Citi® PremierPass Card provides an attractive 12 month, 0% APR on balance transfers and retains a competitive ongoing APR thereafter. This card may also be attractive due to the ‘no annual fee’ offer. This card makes things very simple by providing one airline point for every three miles you fly (on any airline) and it provides 1 point for every dollar charged to your airline credit card. This particular card provides 5,000 reward points the very first time you use your card.

For those who would like a bigger bonus when starting their journey with an airline credit card they might find the United Airlines Mileage Plus® Signature Visa® card to be more to their liking. This particular card offers one of the highest bonus miles (after first purchase) in the industry. The kick off bonus miles list at 17,500 and this card will provide up to 11 miles for every dollar spent at participating cafйs and restaurants throughout the U.S. This particular card does require an annual fee of $60, however they do include other perks specific to flights on United Airlines.

The Citi Gold Advantage® World MasterCard also features a higher bonus mile total on your first purchase at 12,500 miles and an annual fee of $50, but it adds the bonus of redeeming mile points for major car rental outlets as well as several hundred-hotel accommodations around the globe.

Making Sense of the Numbers

In the first scenario you find lower fees, interest and bonus miles. In the other two, you find higher fees and interest, but you also have the capability to accelerating your air travel plans. With the bonus offerings, the second and third choice may be the right fit for many vacation hungry consumers.

Consumer Empowerment

Taking a couple of minutes to examine airline credit card offers may well result in a good fit for your budget, travel aims and potential rewards needs. Your reward is without the aid of any pressure from a salesperson and you have passage to all pertinent details at the click of your mouse.